IN THE COURT OF APPEAL OF SAMOA
Tafua v Samoa Rugby Union Inc. [2020] WSCA 2	

Case name: 	Tafua v Samoa Rugby Union Inc	
		
Citation: 	[2020] WSCA 2	
		
Decision date: 	11 August 2020	
		
Parties: 	FUIMAONO TITIMAEA TAFUA (Appellant) and SAMOA RUGBY UNION INCORPORATED (Respondent)	
		
Hearing date(s): 	3 August 2020	
		
File number(s): 	CA28/19	
		
Jurisdiction: 	CIVIL	
		
Place of delivery: 	Court of Appeal of Samoa, Mulinuu	
		
Judge(s): 	Honourable Justice Fisher
Honourable Justice Blanchard		
Honourable Justice Nelson	
		
On appeal from:	Supreme Court of Samoa, Mulinuu	
		
Order:	The appeal is dismissed with costs to the respondent in the sum of SAT$5000.	
		
Representation: 	L. T. Malifa for the Appellant
S. Leung-Wai for the Respondent	
		
Catchwords: 	employment dispute – national rugby team – coach – contract terminated.	
		
Words and phrases:		
		
Legislation cited:	Acts Interpretation Act 2015, s. 8;
Labour and Employment Relations Act 2013, Part VIII; ss. 3(4)(a); 52(1); 53; 54(1); 54(2); 
Public Bodies (Performance and Accountability) Act 2001.	
		
Cases cited:	Paper Reclaim Limited v Aotearoa International Limited [2007] NZSC 26; [2007] 3NZLR 169 at [24]-[25];
Tafua v Samoa Rugby Union Inc. [2019] WSSC 90 (8 August 2019).	
		
Summary of decision:		

CA28/19

IN THE COURT OF APPEAL OF SAMOA
HELD AT MULINUU

BETWEEN:	

FUIMAONO TITIMAEA TAFUA

Appellant

A N D:	

SAMOA RUGBY UNION INC

Respondent

Court:		Honourable Justice Fisher
		Honourable Justice Blanchard		
		Honourable Justice Nelson

Hearing:	03 August 2020

Counsel:	L. T. Malifa for the Appellant
		S. Leung-Wai for the Respondent

Judgment:	11 August 2020

JUDGMENT OF THE COURT
An employment dispute
1. 	The Appellant, Mr. Tafua, was engaged by the Samoa Rugby Union Inc. (the Rugby Union) to be the Head Coach of the Manu Samoa 15s rugby team under an employment agreement signed by him on 17 May 2018 and by the Chief Executive Officer of the Rugby Union on 21 May 2018.  However, on 24 September 2018 Mr. Tafua received one month’s written notice of termination of the contract.  The issue in the case is whether that notice was valid in accordance with Part VIII of the Labour and Employment Relations Act 2013 (“the Act”).  Tuala-Warren J held in the Supreme Court that it was and from that decision Mr. Tafua appeals. 
2. 	The commencement date of the agreement was stated in the agreement to be “confirmed by agreement, but not expected to be later than the 15 of September 2017”.  It is not contested that the agreement was confirmed and that it duly commenced in 2017 notwithstanding the execution date.  
3. 	The term of the agreement was expressed in the following way;
	“The term of the contact is subject to the termination clauses, [and] satisfactory completion of the probation period of 3 month period [sic]. The term would conclude at 30 November 2019.”
The probation period was satisfactorily completed. 
4. 	The agreement provided for a remuneration package consisting of a base salary of SAT$125,000 and various allowances.  
5. 	The agreement contemplated a series of performance reviews but nothing presently turns on them.
6. 	The termination clauses referred to in the clause setting out the term are found under the heading “Termination”.  There are two of them.  The first reads;
	“Subject to the successful completion of the probationary period, either party may terminate employment by giving one month notice in writing, or in the case of termination by Samoa Rugby Union Inc., payment in lieu, except in the case of dismissal for serious misconduct that justifies instant dismissal.”
7. 	The second termination clause deals with dismissal for serious misconduct but we need not describe it as no allegation of misconduct has been made against Mr. Tafua.  
8. 	The case for the Rugby Union is that his dismissal by the notice referred to in [1] above received by him on 24 September 2018 was pursuant to the first termination clause (which hereafter we will refer to as “the termination clause”).  Mr. Tafua’s case is that the Rugby Union was not entitled to bring the contract to an end by giving one month’s notice because that was contrary to Part VIII of the Act.  
The Supreme Court judgment
9. 	There were two rulings by Tuala-Warren J which were not challenged on this appeal.  The first was her decision that the Act applied to the Rugby Union; that it is a public body as defined in the Public Bodies (Performance and Accountability) Act 2001 (“a non-governmental business entity”). The 2013 Act applies to such a body: s. 3(4)(a).  The second was her dismissal of Mr. Tafua’s pleaded claim (his alternative cause of action) that the Rugby Union in purporting to dismiss him was in breach of an alleged implied obligation of good faith towards him.  As those matters were not raised in this Court we need say no more about them.
10. 	Section 52(1) of the Act (the first section in Part VIII) states that a “contract of service” as defined in section 2 of the Act “may be terminated in accordance with provisions of this Part”.  It is accepted that Mr. Tafua’s agreement was a contract of service.  The Judge said that the use of the word “may” in section 52(1) is “discretionary”, citing section 8 of the Acts Interpretation Act 2015.  She described Part VIII as “a catch all Part in the event that a contract had not specifically dealt with termination or if contracting parties wished for those provisions to apply”. The parties in this case had included a termination clause in their contract of service.  So the Rugby Union did not need to give a reason for termination provided it paid Mr. Tafua in accordance with the clause, i.e. one month’s payment in lieu.  It was not in dispute that this payment had been made on 27 November 2018.
The termination provisions in the Act
11. 	Sections 52(1), 53 and 54(1) & (2) provide as follows;
	52. Termination of a contract of service - (1) A contract of service may be terminated in accordance with the provisions of this Part.
53. Termination of a contract of service for a specific period or task - (1) Subject to subsection (2), a contract of service for a specific work or for a specific period of time is terminated: 
	(a) when the work specified in the contract is completed; or 
	(b) when the period of time for which the contract was made has expired. 
	(2) Despite subsection (1), a contract of service for a specific work or for a specific period of time may be terminated under section 57. 
	54. Termination of a contract of service for an unspecified period - (1) A contract of service for an unspecified period of time is a continuous contract, which may be terminated by either party, under section 57 or by giving notice under subsection (2). 
	(2) Where either party to a contract of service wishes to terminate a contract of service, the notice period must be made in accordance with the length of time of service set out in Schedule 2.
(Section 57 deals with misconduct by an employee and abuse or harassment by an employer and is of no relevance in this case.)
The submissions of counsel
12. 	Mr. Malifa, counsel for Mr. Tafua, argued that the Rugby Union had impermissibly attempted to contract out of these provisions.  He said that, as the contract had a term expiring on 30 November 2019, section 53 must apply to it and the Rugby Union could not rely on the termination clause, which was inconsistent with Part VIII.  He supported this argument by submitting that the weight of the agreement was against the employee and that it should therefore be given a reading favouring the employee.  Mr. Leung-Wai, for the Rugby Union, supported the Judge’s view that section 52 is couched in permissive terms.  He said section 53 does not prohibit the termination of a contract of service by notice if a termination clause to that effect is provided for in a contract.  In this instance it was section 54 that was the relevant provision making the notice of termination valid as it complied with Schedule 2. 
Discussion
13. 	Before the impact of Part VIII of the Act on an employment contract can be determined, it is necessary to investigate how the provisions of the contract would operate in the absence of Part VIII.  Only after this is done is the Court in a position to determine whether such operation is prevented by anything in Part VIII.
14. 	The present contract has a term, until 30 November 2019.  But, that term is expressly subject to the termination clause (see [3] above).  The termination clause is thus the overriding contractual provision.  It permits either party to terminate the employment by giving one month’s notice in writing (see [6] above), notwithstanding the existence of the term.  In legal effect, at common law, the contract is one terminable by one month’s notice to expire, if no prior notice is given, on 30 November 2019.  The stipulation for the expiry date thus has the function – a relatively limited one – of ending the employment if it has not by that date been brought to an end by a notice of the requisite length.  Indeed, subject again to any effect of Part VIII, even if the notice given had been defective because, for example, it specified less than one month’s notice, the fact that the agreement did allow the giving of one month’s notice would have the consequence that the damages for such a breach of contract by the employer could not exceed the equivalent of one month’s remuneration.  This is because it is a general principle of contract law that damages for breach are assessed on the assumption that where a defendant has the option of performing a contract in alternative ways, the defendant will do so in the way least burdensome to it; that in a case where a termination notice could lawfully have been given the defendant would have chosen to do so.
15. 	We are now in a position to consider the impact of Part VIII. We do not agree with the Judge’s description of section 52(1) as permissive, or her view of the Part as a catch all for contracts not specifically dealing with termination.  We consider that section 52(1) allows termination only in accordance with the Part.  If an employment contract contains a termination provision which is incompatible with any section of Part VIII, that provision is not lawful and must be disregarded.  If that were not so, the reforms plainly intended by the Part would not achieve their purpose whenever an employer chose to include less favourable provisions in the contract.  It is noticeable that, like section 52(1), section 54(1) also uses the word “may” and it surely cannot have been the legislative intention that, despite sub-section (2), an employer could, in a continuous contract, avoid the need to give a notice of a minimum length complying with Schedule 2. 
16. 	That brings us to the crucial question: which of sections 53 or 54 applies to the present employment contract?  Is it properly to be regarded as a contract for a specified period of time, as Mr. Malifa asserts, or as a continuous contract?  In our view because the termination clause is expressed to override the provision for expiry on 30 November 2019, the contract is better characterised as a species of continuous contract, operating as such until and unless that stipulated date is reached without a notice having been given.  It is not truly a contract for a specified period of time falling within section 53, as it would have been if it had said, for example, that there was to be a term commencing on 15 September 2017 and terminating on 30 November 2019 and there was no provision for any giving of a termination notice allowing termination without cause.
17. 	Section 53(1) appears merely to state the position that would otherwise pertain at common law, having no greater effect. Section 54, on the other hand, does introduce a reform; the notice period in a continuous contract must be of the minimum length which accords with the length of the employee’s service as set out in Schedule 2.  The notice period in Mr. Tafua’s contract met that requirement. In coming to this conclusion we have considered whether the inclusion of section 53(1) in Part VIII may have been intended by the Legislature to prevent the use in Samoa of a termination provision of the hybrid nature of the clause that is the subject of this appeal but can discern no abuse created by such a clause.  An employer can always stipulate for a simple continuous contract complying with Schedule 2.  There is no reason that we can see why it should not then add a provision under which that continuous contract will come to an end without notice being given on a specified date.  It would make no sense to strike down such an arrangement by not allowing notice to be given under section 54(2).
Result
18. 	For these reasons the appeal is dismissed with costs to the respondent in the sum of SAT$5000.

HONOURABLE JUSTICE FISHER
HONOURABLE JUSTICE BLANCHARD
HONOURABLE JUSTICE NELSON